Sreedhanya Construction Company Vs State of Kerala (High Court of Kerala)
Kerala High Court held that when contract rates fixed are inclusive of GST and other taxes, contractor is not permitted to claim GST over and above the fixed rates. Accordingly, writ dismissed.
Facts- The Petitioner is a partnership firm engaged in undertaking contracts for construction of roads and bridges and is stated to be a registered ‘A class’ Contractor with the Kerala Public Works Department. It entered into agreements with the Kerala Road Fund Board for certain works. Issue involved in the present petition is that Can a person who enters into a contract with the Government or its agencies that contains a specific clause that the rate quoted shall be inclusive of ‘GST & other taxes’ turn around and claim that he is entitled to Goods & Services Tax (GST) over and above the rate quoted by him?
Conclusion- Held that if the contention of the petitioner were to be accepted, the sanctity of the tendering process itself will be affected is only to be accepted. This can be illustrated by means of an example. When the tender document/agreement contemplated that the rates quoted shall be deemed to be inclusive of GST and the successful bidder quotes Rs.100/-for a particular item of work, he cannot be permitted to, thereafter, turn around and claim that he must be given Rs.100/- plus 18% GST (total of Rs.118) as there may have been situations where another bidder, after noticing the conditions in the tender document would have quoted Rs.105/- inclusive of GST and would not have become successful on account of the fact that the successful bidder has quoted only Rs.100/-. In such a situation, if the successful bidder is allowed to claim 18% GST over and above the rate of Rs.100/- quoted by him, the Government/its agencies would end up paying Rs.118/-which obviously, cannot be accepted.
